Coal output by Coal Energy plunges to record low

Coal output by Coal Energy plunges to record low



19 серпня 2014 года
Конкорд Капитал

Coal Energy (CLE)


Total coal output by thermal and coking coal miner Coal Energy (CLE PW) plunged to its record low level of 9.6 kt in July, the first month of Coal Energy’s 2015 financial year. The drop in the operating result occurred in all segments across the board: thermal coal mining fell 94% yoy to 2.4 kt in July (-78% m/m), coking coal mining plummeted 79% yoy to 2.2 kt (-77% m/m), and marketable coal output from waste reprocessing dwindled 62% yoy to 4.9 kt (-6.9% m/m). Management commented in its market report that production volumes had been adjusted based on the current political and economic situation.



Roman Topolyuk: Coal Energy's adverse operating results in July are explainable: its subsidiaries are located in the Donetsk and Luhansk regions, close to or inside areas controlled by separatists and where warfare is occurring. Damage to the railway connection in the two regions has placed severe constraints on coal delivery to coking plants and other consumers.



The firm's low coal production volumes, coupled with the more than 50% depreciation of the hryvnia since the start of 2014, threaten the sustainability of its business operations and ruin the company’s ability to service its debt facilities. We expect the company will or already has approached its lenders to obtain special relief, in terms of maturity, and to negotiate new terms due to the abnormal business environment. Any success in these negotiations will define largely whether Coal Energy is a going concern.

Источник: Конкорд Капитал

Аналитик: Роман Тополюк
Другие обзоры по компаниям и отраслям от Конкорд Капитал


Компании

все компании